Should You Renovate and Create a Revenue Rental Suite?
Home prices and rentals in Canada are increasing at insane rates. Revenue-producing suites are fast becoming a major asset for retiring or retired homeowners for additional revenue streams.
Imagine Being a Renter in Today’s Markets?
We cannot help but feel empathy for those that are renting homes or suites. Where we live on Vancouver Island rental rates are going through the roof.
Basement suites with two bedrooms are on average $ 1,500.00 a month, a 600 Sq. foot townhouse or apartment around $1,100.00. If you want a full house, you will be looking at a minimum of $2,000.00 and that will not get you an executive, not even close.
Please note these rental rates are based on a small city, not large cities like Vancouver or Toronto.
Revenue Rental Suites
Rental suites are certainly an idea if you would like to create additional income from your home. But what if you do not have enough money, to create a Legal Suite that can cost $20,000.00 to $40,000.00?
Think carefully as to your age and how much equity you have. Let us say your home is paid for and is valued at around $650,000.00.
Taking out a Reverse Mortgage for $40,000.00 (or more if you like) based on a two-room, one bath suite can, in turn, produce $18,000.00 a year. Imagine in only two years you have already almost made your money back. Let us say you continue for another ten years, now you can add another $180,00.00 to your income!
You have not needed to use any high interest borrowed money; you do not have to pay back the $40,000.00 (banks collects from your estate when you pass to the clouds) and you have increased the value of your home a minimum of 40K, and betting that in only a few years it will increase even more.
Rental suites may not be for everyone, however what a great way to help with your retirement income and you still have 100’s of thousands available from your home equity!
There are so many ways a Reverse Mortgage can help us in our retirement years the list is literally endless.